Actual Cash Value
Barron's Insurance Dictionary:
Top
Actual Cash Value
Cost of replacing damaged or destroyed property with comparable new property, minus depreciation and obsolescence. For example, a 10-year-old living room sofa will not be replaced at current full value because of a decade of depreciation. The actual cash value clause is common in property insurance contracts.
In some instances artistic or antique property may appreciate over time. To receive full coverage such items must be specifically scheduled in a policy.
In some instances artistic or antique property may appreciate over time. To receive full coverage such items must be specifically scheduled in a policy.
| Actual Authority (Express Authority), Acts, Actively Managed Fund | |
| Actuarial Adjustment, Actuarial Board For Counseling and Discipline, Actuarial Consultant |
West's Encyclopedia of American Law:
Top
Actual Cash Value
This entry contains information applicable to United States law only.
The fair or reasonable cash price for which a property could be sold in the market in the ordinary course of business, and not at forced sale. The price it will bring in a fair market after reasonable efforts to find a purchaser who will give the highest price. What property is worth in money, allowing for depreciation. Ordinarily, actual cash value, fair market value, and market value are synonymous terms.
Investopedia Financial Dictionary:
Top
Actual Cash Value
The amount equal to the replacement cost minus depreciation of a damaged or stolen property at the time of the loss. It is the actual value for which the property could be sold, which is always less than what it would cost to replace it.
Investopedia Says:
Sometimes, insurance companies use actual cash value to determine the amount to be paid to a policyholder after loss or damage to the insured property. In the case of an automobile that is totaled in an accident, for example, the insurance company would typically pay the actual cash value of the vehicle after determining its replacement cost and subtracting factors such as depreciation and wear and tear. Under replacement-cost coverage, the insurer would pay the amount required to replace the covered item with a like-kind new one.
Related Links:
Find out how calculating a reproduction cost for a company can beat out the dividend discount model. Company Clone Cost Reveals True Value
Discover everything new homeowners need to know before they sign on the dotted line. The Beginner's Guide To Homeowners Insurance
Avoid shelling out for these policies and you could save hundreds of dollars. Extended Warranties: Should You Take The Bait?
Post a question - any question - to the WikiAnswers community:
Copyrights:
Barron's Insurance Dictionary
Dictionary of Insurance Terms. Copyright © 2008 by Barron's Educational Series, Inc. All rights reserved.
Read more
West's Encyclopedia of American Law
West's Encyclopedia of American Law. Copyright © 1998 by The Gale Group, Inc. All rights reserved.
Read more
Mentioned in
ACV
(abbreviation)
Market Value Vs. Actual Cash Value
(business term)
Market Value Clause
(business term)
Nonvalued Insurance Policy
(insurance term)
Obsolescence
(insurance term)
» More